Polls come and go and the court of public opinion is both malleable and fickle. Regardless how you view recent Supreme Court decisions, public opinion polls or state-specific issues that affect voter preference, President Obama got incredibly bad news this morning that likely overrides any perceived strength or weakness from the political news cycle over these last few weeks. Europe is already in a recession and today’s economic data is the first meaningful sign the US may be there soon:
The global economic slowdown has finally caught up with American manufacturers. The U.S. factory sector shrank in June for the first time since July 2009—the first month of the economic recovery—the Institute for Supply Management said Monday. Exports fell, and new orders, which gauge future factory activity, dropped at their fastest pace since the post-9/11 plunge in October 2001. The darkening outlook for U.S. factories comes amid new signs that the rest of the world is losing momentum, too. Manufacturing activity in the euro zone continued its months-long decline in June, with even the region’s biggest economy, Germany, contracting at its fastest pace in three years. Manufacturing also slowed in China, the world’s second-biggest economy, and South Korea’s and Taiwan’s manufacturing industries fell into contraction. The Institute for Supply Management’s index of manufacturing activity dropped to 49.7 last month from 53.5 in May. Readings below 50 indicate contracting activity. A measure of new orders fell at its fastest pace in over a decade, dropping to 47.8 from 60.1. And new export orders declined to 47.5 from 53.5.
Previously we mentioned that the biggest news last Thursday likely wasn’t the Obamacare decision, but the latest iteration of an EU rescue/bailout. Even if that plan is ultimately successful, despite more than a few skeptics, today’s manufacturing report is the greatest indicator thus far that any EU resolution may be too little too late for President Obama in November.